Web Letters | The Nation

Web Letter

Having taken the time to actually read this Peterson/Pew Report, I was amused that what the report calls for is a plan for future budget cuts, starting in 2014. So plans for making national cuts are pasted the next presidential election--if he is so concerned, why doesn't he call for cuts now? Oh yeah, that would not allow the GOP to spend the next few years complaining and voting no on every budget prior to the next presidential election.

Note, in this paper, it does not directly say to cut Social Security, it only talks to discretionary spending and non-discretionary spending. Now how many generic readers know where Social Security funds are appropriated?

It is indeed disheartening to see a major print publication not add an informational caveat that would enlighten readers about the author. Only when the political leanings of a author are known can one make an intelligent evaluation of an article. Most individuals, myself included, are now being tasked with researching each author to determine their possible underlying agenda.

There are lots of individuals who "sound sincere," but are mere posers... and a failure by a newspaper to ennuciate the background of someone is one of the reasons that paper journalism is dropping like a stone. Why is it that Internet journalism can manage this task and newsprint can't, or won't .

Audrey Fisher

San Antonio, TX

Jan 13 2010 - 2:28pm

Web Letter

Looting and altering the truth about inflation, to avoid paying benefits. I was just told by the Social Security Administrartion that there won't be an increase in benefits this year because there was no inflation, since last year. Gasoline is up a dollar a gallon on average, the price of movies is up, and I'm sure many people see increases in food prices, rent, etc. Also, shouldn't the lack of employment and increase in homelessness and our inablility to pay for things be a determining factor in the definition of inflation?

Thomas Albert Frazee

San Miguel de Allende, Guanajuato, Mexico

Jan 11 2010 - 12:05pm

Web Letter

There is something both supremely and ironically logical about a corporate raider deciding to go after the nation's only remaining viable and remotely soluable "bank." It should also come as no surprise that he would do it with money purloined from prior raiding parties, or that he would do so with a complete misunderstanding of the importance of such an institution to the American people. His callous disregard befits the heinous nature of his aim and objective.

Peterson is a one-man marauding barbarian horde, come to sack Rome, in a Trojan-horse printing press.

Ivan Hentschel

Wimberley, TX

Jan 6 2010 - 11:39am

Web Letter

The article would have been useful and informative had Mr. Grieder at least summarized the actual plan proposed by Mr. Peterson. As it is, he merely used pejorative adjectives.

I read the Social Security and Medicare Trustees reports each year, as well as the GAAP financial statements of the US government. For anyone with financial literacy and unencumbered by political positions, they make bleak reading.

While I consider myself a patriot (as does Mr. Greider, no doubt), as an investor it is becoming increasingly difficult to have a long-term positive outlook on the credit and finances of the United States while educated partisans either lack financial literacy or are in such a profound state of denial. Entitlements are worthless if the country providing them cannot pay for them--inflation, collapse of the dollar and economic stagnation are the results. As Mr. Soros found it necessary to short the British pound, it may soon be necessary to take a long-term short position on the credit of the US government and the dollar.

I commend to your readers the analysis of David Walker, former comptroller general of the United States and head of the GAO, and now a colleague of Mr. Peterson. His work is intellectually honest and describes the long-term fiscal imbalance fairly. At the GAO, he did not proscribe specific remedies.

It does us no good to deny the problem. The only beneficiaries will be individual investors and speculators unconstrained by political positions and prejudices.

Richard A. Sun, CFA

Jackson, MS

Jan 5 2010 - 5:58pm

Web Letter

Mr. Greider is right in that we have to take a broader look at all budget categories, not just Social Security. Social Security is a relatively minor problem compared to Medicare (it has about one-sixth the unfunded liability), our bloated defense budget, or small-government tax levels.

We have 77 million Boomers retiring and we have not structured our taxation and other spending to handle that.

But he must acknowledge that Social Security is unaffordable without significant reform, since the 3.3 workers per retiree ratio of today is switching to 2.1 by 2040; we had a 5-to-1 ratio in 1960.

Under current law, benefits will be cut 25 percent around 2036, when the surplus runs dry, according to the Social Security Administration. Further, the pre-crisis surplus of $200 billion will switch to an average deficit of $200 billion over the 2017-2036 period while the trust fund is liquidated. This is a $400 billion annual increase in the deficit!

Two key reforms are merited in the program, as part of wider measures outside the program: (1) removing the $106,800 payroll tax limit, which affects the top 6 percent of taxpayers; and (2) reducing cost of living adjustments to inflation instead of inflation plus a premium, either for all or for wealthier recipients.

Further, significant defense reductions (about 50 percent) will be required and every good cost control idea will have to be applied to Medicare. The long-term budget issue is really all about healthcare cost reform. Even if every good idea is applied and effective, we might not cut costs enough to avoid rationing.

We can also buy ourselves a decade or two by reversing all of the major tax exemptions and deductions (e.g., mortgage interest, healthcare benefits provided by employers) and reversing the Bush tax cuts, which CBO and The Economist estimate will bring in another $500-700 billion per year in tax revenue.

Ultimately, the real question is about Medicare and Healthcare reform. Social Security is about one-fifth as big a problem as Medicare.

David Doney

Chicago, IL

Jan 5 2010 - 9:58am

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